The past few years have hit the gaming industry hard in terms of employment. Many companies have announced mass layoffs over the past few years, and things don’t seem to be slowing down. In another shocking announcement, Sony had announced that they would be letting go of 900 employees from their London studio. Apparently, none of the employees had a clue about such a decision.
Sony Interactive Entertainment announces a reduction in its global workforce: https://t.co/O5hLTYGltq
— PlayStation (@PlayStation) February 27, 2024
Sony announces the closure of their London PlayStation Studio.
Around 9 percent of the global headcount was affected by this layoff. The London studio was in charge of a variety of VR projects, and all such departments have been affected by this mass layoff. Sony had failed to hit its PlayStation 5 sales target last year, and the company stock price took a dip of almost $10 billion USD. Sony apparently was making very low margins on exclusive game titles, and the cost of developing more such titles was accumulating for more losses.
Sony President Hiroki Totoki recently told its investors that Sony was pushing for more multiplatform games. The company aims to release titles that can be played on PCs, mobiles, and other gaming devices. The core agenda would be to welcome more PC players into the ecosystem. Gaming designing studios owned by Sony will now focus on cross-platform games, and it’s very likely that we might not see PlayStation exclusive titles in the future.
Layoffs at PlayStation impact Naughty Dog, Insomniac Games, Gurellia, Firespite, SIE, and more
PlayStation says “we looked at our studios and our portfolio, evaluating projects in various stages of development, and have decided that some of those projects will not move forward” pic.twitter.com/gynLtADDRK
— CharlieIntel (@charlieINTEL) February 27, 2024
Covid era aftereffect in play.
The gaming industry as a whole saw a major boom during Covid with the work-from-home culture kicking in. The majority of the major companies have hired thousands of employees with the hope to profit off the sudden rise in gaming. Through 2020 and 2021, PlayStation consoles were in peak demand, and Sony struggled to keep up with it. Unfortunately, in 2023, Sony fell short by roughly 20% in meeting its forecasted sales target. This accounted for the mass layoffs that are presently happening.
Many publications have reported that the London employees were caught completely off guard with this announcement. Other groups that have been impacted include Naughty Dog, Insomniac Games, and support teams. Sony issued a statement regarding the layoffs and their ongoing commitment to releasing high-quality video game titles. These layoffs do not come as a surprise to business experts as they anticipate more of such layoffs throughout the year. Microsoft, Blizzard, Discord are among the many big-name companies who were forced to lay off employees and tighten their expenses.
Though it looks like a sad era for gaming, the truth is that companies are focusing on a more open ecosystem. Every game development company wants to dip their toes in all platforms. Xbox recently announced that they would be releasing their exclusives for PlayStation consoles. PlayStation, on the other hand, has already developed titles for both console and PC. The hype of cross-platform gaming is going to reach its peak in the coming years as game developers lean towards making their titles available for everyone. 2024 has already seen titles like Palworld and Helldivers 2 soar through the roof with regards to overall sales. The developers of both these titles have crossplay enabled only for PC. They plan to expand it to every device very soon.
